The Renault-Nissan-Mitsubishi alliance said it is setting up a venture capital fund that plans to invest as much as $1 billion over five years, the latest move by major carmakers as they seek to adapt to rapid industry change by investing in startups.

It is set to be largest corporate venture capital fund in the auto industry over the period until 2022, the companies said in a statement.

The traditional auto industry model based on individual ownership is threatened by pay-per-use services such as Uber, as well as ride- and car-sharing platforms, a challenge heightened by shifts towards electric and self-driving cars.

The fund expects to invest up to $200 million in its first year and key potential areas of investment include vehicle electrification, autonomous systems and artificial intelligence, the statement said.

It will be 40 percent financed by Renault SA, 40 percent by Nissan Motor Co Ltd and 20 percent by Mitsubishi Motors Corp.

The plan, reported by Reuters last week, calls for the firms to establish the fund as a Dutch-registered joint venture headed by Francois Dossa, a former banker who led Brazil operations for Societe Generale and then for Nissan, sources familiar with the matter said.

The first deal by the fund, called Alliance Ventures, will be a strategic investment in Ionic Materials, a U.S.-based firm that is developing solid-state cobalt-free battery materials.

The $200 million initial venture capital investment comes in addition to more than 8.5 billion euros ($10.2 billion) in combined annual research and development investments by the three automakers.